A 3 yo literally cannot tell the truth from a lie. Often they say what they wish was true, or what they think will make you happy. Sometimes they will tell the truth, but you can't count on it. They are just living in a fantasy world at that age.

I think "lying" by 3 year-olds is so ubiquitous that I consider it developmental. I think they confabulate and imagination and truth simply blur. I don't in any way reprimand my 3 year-old twins for lying or even try to really address it that much.

I'll give an example of how I handle lies. My daughter came into the living room holding scissors in her hand. She announced that she was NOT cutting hair. I noticed, however, several chunks of freshly cut hair on her shoulder. I just told her that it looked like she had chunks of hair on her shoulder and asked her to use the scissors in the living room.

In another example, I asked my daughter if she had eaten a bite of something that I knew had nuts in it. (She has food allergies). She said no, but I sensed she was scared of telling me. I just asked her again and told her that it was okay. I just needed to give her medicine if she had and asked her again. Then, she told me yes. I didn't even mention her previous "lie." They almost never lie about misbehavior.

My nearly 4 yo can still wake up from a dream and still truly believe that the events were real. Or he can fear something totally illogical, like dragons in the day care. And then if he repeats this 2 or 3 times, he may actually believe this happened, as opposed to just talking about it.

He can not always distinguish reality from fantasy. So I can't expect him to never lie, if he truly believes it is real. KWIM?

My almost-three year old tells lies - his favorite is to try to blame things on his baby sister. When he does that, I tell him "I know wish your sister did it, but I know you did (whatever). Can you help me clean up/comfort the dog/replant the flower/fish the tootbrushes out of the toilet?"

If he blames it on an imaginary thing - sometimes he tells me a tiger or hippo did it - I ask him to please tell the tiger what I said. He seems to like that one a lot. It gets trickier if he tells me that an animal is going to put his toys back for him so he doesn't need to.

He's really imaginative right now so I know that the things he makes up aren't malicious. Little people are in their own worlds.